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Federated States of Micronesia offers the following non-resident corporate entities, which are governed by the Federated States of Micronesia Companies act of Title 32 of national code.
Federated States of Micronesian corporate entities can be utilized for a wide range of activities including:
- International Trade
- Real Estate Investment
- Joint Ventures
- Holding Securities and Bank Accounts
- Trust and Estate Planning
- Management of Investment Portfolios
- Asset Ownership
- Vessel Ownership
- Intellectual Property Holdings
- Professional Services
- Fulfillment Companies
- Any other non-licensable Business Activities
Federated States of Micronesian Corporations are easy to form and administer and require no annual filing.
Corporations are particularly suited for personal or business single-asset ownership as well as for use as holding companies. Moreover, they are sufficiently robust for a public offering.
Limited Liability Companies (LLC)
The Federated States of Micronesian Limited Liability Company (LLC) is an entity designed to provide the limited liability features of a corporation with the operational flexibility of a partnership. The LLC is a preferred form of entity for holding real estate and other forms of asset investment. The LLC is not a tax paying entity and any profits or losses are reported on the individual member’s tax return.
Members of a Federated States of Micronesian LLC have the same limited liability protection afforded to shareholders of a corporation.
General & Limited Partnerships
Federated States of Micronesian Limited and General Partnerships are an attractive form of entity for investors who do not want to be involved in the daily operations of the business, but seek limited liability and the benefits from profits generated by the entity. Limited Partnerships are often formed by business owners involved in real estate, manufacturing and other business ventures.
The Private Foundation is a useful for individuals seeking to preserve the wealth-generating activities of a family, while making the income available to the beneficiaries in accordance with the donor’s wishes.
The Private Foundation is a separate legal entity, which is the legal and beneficial owner of its assets.
The Federated States of Micronesian Private Foundation requires limited public filing, and does not provide for disclosure of the donor or beneficiaries.
Foreign Maritime Entities (FME)
A non-Federated States of Micronesian business entity, such as a foreign corporation, partnership, or other legal person, may own a Liberian-flagged vessel by registering the non-Federated States of Micronesian entity in Federated States of Micronesia as a Foreign Maritime Entity (FME). In order to register as an FME, the foreign entity must have legal existence in its underlying jurisdiction, the power to own a vessel, and the capacity to sue and be sued in its own name. It must also remain in good-standing in its underlying jurisdiction and in Federated States of Micronesia.
Registered Business Companies
The Registered Business Company law requires the company to record most of its operational information with the Registrar.
This business company allows the appointment of a Managing Director and Corporate Secretary. Under the companies act, the board of directors and corporate officers may be individuals or business entities. Additionally, there is no mandatory requirement to file the names of directors, officers, or shareholders with the Registrar of Corporations or Registered Agent. However, this information may be filed or recorded voluntarily.
International Business Corporations (IBCs) are one of the most widely used business vehicles. IBCs are considered distinct legal entities and are utilized for a variety of purposes, such as holding securities and bank accounts, entering joint ventures, trust and estate planning, asset protection, public offerings for raising capital in world markets, international trade, and holding vessels.
IBCs give owners the ability to maximize profitability while minimizing personal liability. In the event of a business loss or lawsuit, shareholder liability is limited to his/her direct capital investment in the corporation.
Entity Formation is simple; a company may be formed in one (1) business day. The following information needs to be provided to any MISR office in order to proceed with the incorporation of a FSM IBC: corporate name, share structure, and organizational activity. RMI IBCs may also be formed online.
Corporate names may be in any language as long as Roman characters are used. Any standard, internationally accepted, corporate suffix is permitted. Name clearance may be achieved over the telephone, via fax, or email through any MISR office. Names may be reserved at no cost for up to six (6)months in advance of formation. Two (2) alternative names should be provided in the event that the first selection is not available.
IBCs may issue shares in registered and/or bearer form with par or no par value. Par value of shares may be denominated in any currency. A standard formation is 500 registered and/or bearer shares without par value, or up to 50,000 USD worth of par value stock. Authorized share capital above these amounts will incur a one time capitalization.
OPTIONAL ORGANIZATIONAL ACTIVITY
If instructed by the client at the time of incorporation, the incorporator may take the following actions at no additional cost: elect directors, appoint officers, adopt bylaws and apostille documents.
There are three types of Registered Business Companies:
- Limited by shares
- Limited by guarantee
- Unlimited or a hybrid of both one and two Registration of Foreign Trusts
It is possible for a foreign trust to Register in Federated States of Micronesia.